The Development Bank of Latin America and the Caribbean (CAF) has announced that Paraguay will be one of the next destinations for the expansion of CAF Asset Management Corp. (CAF-AM), its subsidiary specialized in managing investment funds for infrastructure. The initiative seeks to attract more private capital to finance strategic projects and to complement the sovereign loans traditionally granted by the institution.
CAF's Manager of Investments and Financial Development, Alejandra Botero, reported that the capitalization of CAF-AM will be submitted for consideration by the Board of Directors to allow its expansion into new markets, following the positive results obtained in other countries in the region. "The capitalization of CAF-AM is being taken to the Board to expand it into three additional countries, given the very positive experience in Uruguay and Colombia," she stated.
Botero specified that Paraguay and Peru have already been defined as new destinations, while the third country is still pending confirmation. "CAF-AM will enter Peru, Paraguay, and a third country to be determined. It is already in Uruguay, where we have four funds; in Colombia, with two funds; and also in Costa Rica. It has been a very successful experience," she highlighted.
Established in 2014, CAF-AM is the development bank's fund management entity. Its function is to manage third-party capital intended primarily for the private financing of infrastructure projects in CAF's shareholder countries. Its investors include pension funds, insurance companies, development banks, and professional investment managers.
Although approximately 85% of CAF's portfolio corresponds to sovereign operations—loans granted to states to finance public works, fiscal support, or other government projects—the remaining 15% is channeled into non-sovereign operations, including financing for the private sector. In this segment, CAF has various financial instruments at its disposal, such as corporate loans, structured financing for public-private partnerships (PPP), credit lines for development banks and commercial financial entities, as well as investments in specialized funds.